In today’s episode, Allan interviews serial entrepreneur Henry Daas. Henry has decades of experience as a business and financial coach, and he is the author of the book FQ: Financial Intelligence. Allan and Henry discuss the top five reasons businesses fail, and how to avoid financial mistakes as an entrepreneur. Henry can be reached via his website at Home • daasKnowledge or on Linkedln at 20) henry daas | LinkedIn
Allan has started and grown several multi million dollar businesses. His mission is to help you do the same. Welcome to the Business Growth Pod, building the future one entrepreneur at a time.
Quite a few younger entrepreneurs who live in scarcity, right I talked about in my first the first book, a first chapter of my book FQ- Financial Intelligence is the psychology of money. Right? And there’s two goalposts. There’s scarcity and then there’s abundance. You want to live somewhere in between somewhere in the middle of those goalposts, there’s a time for abundance. There’s a time for scarcity. But yet I made a lot of early stage entrepreneurs who are so pent up about hoarding their shekels, worried about losing money, worried about going out and getting a line of credit or finding investors or whatever it is that they need to do, that they end up squeezing the life out of their business, to the point where if they had a decent core idea, and they needed to pivot, if they had a little more capital, they could have gotten there, but they didn’t. And it all fell apart.
Hey, everyone, welcome to the show. I’m Allan. I’m a family man and attorney and an entrepreneur. Each week, we provide resources and advice to help build your business. Are you ready? Then let’s go.
Hey, everyone, I’m excited to welcome Henry Daas to our show today. Henry is a business coach, a screenwriter and a personal finance coach. And he’s also the author of a book that we’re gonna get into a little bit called FQ: Financial Intelligence. Welcome to the show, Henry.
Thanks for having me. I appreciate it.
Why don’t you tell us a little bit about yourself, introduce yourself. Tell us kind of what your story is.
My little backstory my logline to use the screenwriting terminology. So I am a 30 year serial entrepreneur, started my first company in 91. And in the tech space, I’ve had, you know, 6789, I’ve lost count of how many businesses I’ve started. Some have done really well, some maybe not so much. A few years ago, like you mentioned, I wrote this book FQ- Financial Intelligence I wrote, I actually wrote it as a course. And then I sort of backed into turning it into a book. Yeah, that’s basically it. I coach a lot of entrepreneurs. I write screenplays for fun. And we talked about baseball cards before you turn the recording on. There’s that. And then I play a lot of golf, I do a lot of different stuff. Awesome.
So tell me a little bit about the cards that you collect. I know that right now. It’s actually a really hot topic. And it’s, I’ve I’ve heard that there are big time investors that are starting to create funds to invest in sports cards and things like that. Tell me a little bit about your experience and what you have kind of put together over the years. Well, for me, it’s
really more emotional than that. Yes, syndicating card cardboard purchases, as an investment. I don’t want to say I’m bearish on that. Let’s just say in the famous words of Jesse Livermore, the boy plunger, there’s a time to go along, there’s a time to go short, and there’s a time to go fishing. I would go fishing on that one. Let’s put it that way. I do it because it’s fun, or reminds me of my childhood. I don’t know anybody in the modern game. Really, very few my wife. In fact, in 2019, the major league All Star game fell on my 60th birthday. So my wife and I, we got the whole ticket and package from some people that she knows and stand up to cancer, for free. And we ended up driving out to Cleveland. And we went to the whole thing. And I sat there and all star game and the and the homerun Derby and stuff and I knew maybe three players. If you asked me who played in the 1969 All Star game, I could probably rattle them off. So for me, it’s really more about just kind of reconnecting with my childhood. I don’t look at it as an investment per se, even though I’ve got stuff I’ve collected that go back to the 60s and 70s which are you know, worth some coin and if I wanted to now would be the time to sell, you know, it’s a seller’s market.
Yeah, it is. I know that. There’s some kind of iconic cards, and I just wanted to mention this and we can shift gears a little bit but there’s a Michael Jordan FLIR rookie card that just sold a PSA 10 which is good for my listeners. It’s just how they grade it to, you know, say what type of centering and what type of condition it’s in. But just sold for $750,000.
Some guy bought a 50 pigs. Some guy just bought a 52 Mantle, which is not a rookie card, but it’s the first tops year for something like 5.2 million You know what’s crazy, my holy grail is as a Roberto Clemente fan is the 1968 3d card, which was a test print that was done by by Topps. And that sells for 50 grand, and my wife would kill me, if I had spent 50 grand on a card, like that’s probably worth more now, because there were so few of them created. But again, it’s I have an emotional connection to it, I’m not looking at it as an arbitrage opportunity, even though I’ve got cards that are probably worth hundreds, if not 1000s of dollars. If I ever run out of money, then I’ll sell my cards, otherwise, just gonna collect them.
That’s awesome. I think it goes to show you that there’s money to be made out there in different things, and you really have to understand what you’re doing. And you have to do your research and put your time into it. But I know people that like me, I invest in cards, but I also love them. So for me, it’s kind of both aspects of it. But it’s not just that there’s you know, because of, you know, the internet age and everything you can, you can buy stuff off, you know, offer up and flip it for a few bucks. And you know, somebody was asking me the other day, what they could start a business for, for less than a couple 100 bucks. And I’m like, go find something on eBay or online and flip it and you kind of work your work your way up. So I think it goes to show that if you’re creative, you can create a business from something that you’re passionate about or something that you’re interested in.
There’s no question, but I’d say there’s a couple of object lessons in there. Number one is you got to learn your market. A lot of these things they get picked over. So all that’s left are the dregs. So you got to be able to go in there and identify sort of the diamonds in the rough. My wife and I, we go, I call it auction porn, we go on these auction sites and we look for stuff. And every once in a while, we’ll see something that’s obviously mispriced, it’s no different than than buying and selling stocks, you look for a stock that’s mispriced. It’s either Miss price too high and you want to go short, or it’s Miss price too low and you want to go along, you have to refine that. And it’s iterative, and you’re going to make some mistakes. But there’s definitely there definitely business opportunities there. With very little capital requirement.
That’s awesome. You wrote an article on your that’s on your website. And it talks about five of the reasons, most common reasons why businesses fail. I wanted to chat about those reasons and kind of ask you some questions, because I have quite a few listeners that a lot of my listeners are trying to get to the next level. They’re trying to grow their companies and whatever level they’re at, they’re trying to get to the next one. And a lot of them are nervous, because they don’t want to make a rash decision. spend too much money in marketing. Hire the wrong person as they’re trying to grow, and do something that would put what they currently have at stake. Will you kind of walk me through those five reasons and chat with me about that?
Okay, so Reason number five. I’m doing this from memory so correctly, but I think I think I remember, reason number five is confusing commitment with passion. People say, Oh, I, you know, you’ve got to be passionate about what it is that you do. My answer is nonsense. You don’t have to be passionate about it at all. Certainly, it helps if you’re interested in it, I don’t want you to hate it. I know people who’ve gone into business purely for the money, hated it. And if that didn’t work out, but the difference is think about your personal relationships. For those of you who are married or have girlfriends, you know, passion. Sure you were all over each other for the first six to nine months. And then after that, it kind of ends a little, I just celebrated my 30th wedding anniversary on New Year’s. I didn’t get there because of passion. I got there because I was committed to the long haul. Number four messaging a lot of folks, they had no idea what it is that they do. You ask them and they’ll rattle off a bunch of features. I tell people, you’ve got to connect with people emotionally, how are you going to make them feel about doing business with you? Three is money. A lot of lists put money at the top nonsense money, or the lack thereof, has killed a lot of businesses. Number two is hiring hiring is a real bugaboo. And as a business coach, I spend a lot of time with people talking about hiring, because they make terrible hires. I just had a call the other day with a client who I hadn’t talked to in about two years, a former client. He was awful at hiring. But he was very proud of the fact early in the conversation of saying, You know what, I made three really good hires over the last two years. It’s like Congratulations, because it’s tough. And number one is a simple one idea. Your idea sucks. It just sucks. Don’t do it. Don’t fall in love with an idea. I tell people. If you have an idea for business, you should kick the crap out of it. You should go to that guy that you know or that gal who’s negative about everything. You know, we’ve all got some Buddy in our in our social groups who’s you know, negative Nancy always negative, go to that person and pitch your idea to them and let them kill it, right? Because if there’s nothing there, that’s really a deal breaker you might be on to something because you’ll save a ton of money not executing dumb ideas.
Let’s chat about this a little bit. So what’s there to be said about, you know, going into business with an idea. And I think this is all of us, it’s definitely been my experience where what I thought I was going to end up doing or how I thought I was going to end up doing it completely changed. What is there about this, like, Hey, I have an idea. There’s definitely some things that are good about it, there might be some things that are bad about it. But I’m, you know, I’m a tenacious entrepreneur, where I’m going to get in here. And I’m going to pivot, I’m going to figure things out, I’m going to evolve, I’m going to change and sort of thing to be said about that.
Sure, of course. I mean, you got to ask yourself, are you kind of a book learner? Are you an experiential learner? You know, I’m the proud father of three millennials, and certainly they are more experiential than anything else, I can tell them that the stove is hot, don’t touch it. But for the most part, they’re going to go touch it and figure it out for themselves. Right, they’re going to have to get burned before they understand that the stove is hot. Right. So pivoting is, you know, if you can successfully pivot, then something there was some kernel of that idea that had some validity. And you took the time to work it through to figure it out to create something that was real. But you’ve got to have enough intestinal fortitude. And in many cases, you got to have enough capital to be able to get to that point. And for a lot of people, and I work with quite a few younger entrepreneurs, who live in scarcity, right, I talked about in my first the first book, a first chapter of my book, Fq Financial Intelligence is the psychology of money, right? And there’s two goalposts, there’s scarcity and then there’s abundance. You want to live somewhere in between somewhere in the middle of those goalposts, there’s a time for abundance, there’s a time for scarcity. But yet, I made a lot of early stage entrepreneurs who are so pent up about hoarding their shekels, worried about losing money, worried about going out and getting a line of credit, or finding investors or whatever it is that they need to do, that they end up squeezing the life out of their business to the point where if they had a decent core idea, and they needed to pivot, if they had a little more capital, they could have gotten there, but they didn’t. And it all fell apart.
Yeah. So that’s, I mean, that’s interesting, because and my personality is kind of like that I get really nervous about spending money I grew up with, you know, a father that brought in very little, there’s five siblings or six of us total. And, you know, as an entrepreneur, you definitely have to be able to change your mindset to where you’ll spend money to accomplish something that you believe in. I want to skip around to these a little bit. The first one that you mentioned, which I guess was number five is that commitment versus versus passion, which, you know, I’m 100% on board with this, my very first company that I started was a pest control company. And, I mean, I love the industry now, but back then, when I started, it’s not like I was passionate about pest control.
How do you get into that?
So I have, I had done some work for a pest control company in the past. And I have my brother, who’s my business partner, and a lot of the things that I do, he was a salesman for years, very successful, one of the best and made a lot of money doing that. And, and so that’s kind of how we, we fell in into it. One of the nice things about me not being passionate about it, is it’s not like I wanted to be a technician. Like I didn’t start a company so that I could go be the one out there spraying homes. Right. I always had my eye on, you know, the idea of creating a business that could operate without me, which we’re unable to do. I feel like if you’re passionate about something, you’re gonna have to get over that barrier of You’re the one that’s the technician. You’re the one that’s, you know, in the E myth my Gerber talks about this
straight out of straight out of Gerber. Sure,
right. He talks about the baker she’s the best Baker in town, but she can’t pull herself away from the from the ingredients and the oven long enough to
Sally bakes pies and now all of a sudden Sally’s in the pie making business Guess what? Sally’s not baking pies anymore. She’s running. She’s running a pie making business. Right? You’re sure that’s what you want to do. If your passion is to bake pies because for you to scale up and grow Once the day is gonna come where you ain’t making the pies anymore, at least it better or all you’ve done is created a job, you can’t quit.
You know, what’s interesting is that I moderate Facebook group that’s getting fairly large of entrepreneurs, small business owners, and somebody wrote that exact same thing. They wrote it on a post, he said, Hey, if you’re the only employee of your company, you didn’t, you didn’t create a business. You You bought a job.
Yeah. Right, or you view the retina job is what you did.
And you would not believe Henry, how attacked this individual Got it? reads in the hundreds of comments about how what he said was so offensive and who struck a nerve?
He’s he I’ve said it, Brazilian, I’ve said it to my clients. Yeah, that’s what you did. I’m sorry, sorry to be the bearer of bad news. But yeah, I find that fascinating that people jumped down his throat, it was 100%. spot on, right. And this is kind of coming from someone who’s a solopreneur. So if I don’t work, I don’t eat. I understand it, as well as anybody else. Right. The only difference is that 61 years of age are kind of made bank. So without being too Cavalier, it’s okay, for me at this late, late stage of my entrepreneurial journey, but if it was 30 years ago, it’d be a whole nother story.
I have quite a few listeners that are, you know, they’re solo operations. Right. It’s, it’s them and, and that’s it. And I think I have two groups, right, I have individuals that fall into two different camps. I’ve been individuals that you know what, I don’t want the headache of hiring, I don’t want the headache of payroll taxes in the management and the training, I just want to go do my own thing. But I don’t want a boss to tell me how to do it. For those individuals. I’m like, hey, do your thing. You know, it’s your life, you, you know, you’ve created this job for yourself, knock yourself out. And then I have this other camp of listeners where they want to get to the next level, they want to hire their first employee. And you were just talking about how somebody that you coach struggles with hiring, hiring is, for an entrepreneur, especially in it, I mean, any business period, but I’m an I do a lot I own a lot of service businesses is so painful, and it is so hard. What are some things that people can do? And specifically, I’m talking about in the vetting out process, to make sure not even that they get the right fit. But what can they do in the vetting out process to make sure they don’t get the wrong fit?
Well, something I wrote about in my book I called the three legged stool. And isn’t is not a uniquely original conceit that I conjured up, but basically, it’s a stool needs three legs, right to be of any use. This came out of a conversation I had had years ago with the guy who founded the Boston chicken, because somebody pitched him an idea. And he called it a one legged stool, because it just was missing part. So the way I look at it is you’ve got you’ve got three legs of the stool you’ve got what must you have when you’re looking for someone to hire? And what would you like to have? That’s the second leg of the stool, and the third leg is sort of the deal breaker, what can you not have under any circumstances. And if you find a candidate, no matter how well they may fit into the must have, and they would like to have, if they have anything, that’s a deal breaker, then it totally wipes out all of those other things. So that is one, you know, sort of systematic way that you can vet people. The hard part is, people don’t know what they must have when they’re hiring somebody. Now, I’m going through that with one of my clients right now, who’s a $10 million company. And he’s, he’s still, he’s still running the finances himself and doing the invoicing and all this stuff. It’s like you’ve got to hire a controller or CFO or somebody. And we’ve been working on this for weeks to try to come up with the proper job description. Not even a job description, just the list of tasks that you want. And sometimes what happens is people they find this low hanging fruit somebody gets referred to them that they like, and then they gerrymander the job description to fit this person because they like this person. And that rarely works out. So you need to go through that process. You need to hire slowly, fire quickly another I don’t know if that was Gerber or somebody else who said that but I’ve said it a million times. Take your time. Don’t be afraid to to hire people and say, Hey, this isn’t this is a test. I’m gonna put you under the microscope and see whether I was right in in hiring you Before we make a long term commitment, a lot of people don’t want to do that. And as far as you know, payroll taxes, and all of those things, that are the hassle factors that that comes with the deal, because if you’re a solopreneur, and you can’t imagine what it’s like to have a group of people working for you think about how big your company could ever be. Especially if you’re trading time for money, you know, it’s going to be a very low number, not scalable.
I really like what you said about deal breakers. And right now, in certain markets, especially, it’s really hard to find good help, you know, if someone’s on the move right now is a great time to find good job, because I think there’s, at least in some of the markets we’re in, it’s we’re having a tougher time than then in years past. But so what happens is entrepreneurs, business owners, managers, they, they interview somebody, and, you know, a red flag goes up, alert goes off, whatever. And they know, wow, that person really shouldn’t have said that, or that person. You know, this isn’t a good fit. But I’m really behind in hiring. And I’ve done that myself. And I’ve from what I’ve learned from this is, well, hiring the wrong person, sometimes could be much more of a risk than the benefit of hiring the right person. How do they tell themselves to take these red flags more seriously? Because hirings tough man, you know, I’m scaling my companies and there’s, someone’s got to do the work.
Here’s the thought process that goes through people will people will go, okay, God, Greg Henry, I’m going to hire slowly. And they go through the whole process, right? And then they made a bad hire. And they’re like, wow, I spent so much time hiring this person training them up, I can’t believe they failed. You know, let’s stick it out another couple months and see if they turn things around. Right? How many times have you heard that? There’s another great saying when people show you who they are, believe it the first time. That doesn’t work, cut your losses. Again, I’m a trader, one of the other things I do is I trade the markets. And if I make a bad trade, I get out, I take my lumps I booked my loss. And I move on, I don’t get emotional about it. Because I know, I’m gonna make mistakes. It’s just part of life. It’s just how it is. Take the hit and move on. And it’s tough. It’s really tough. I wrote about it. In my book, I said, there’s a scene from Fight Club, where hit where Tyler Durden challenges guys to go out, pick a fight with a total stranger and lose, right? wants them to feel what it’s like to be defeated. I would never encourage anybody to go out and make a bad hire on purpose. But you’re going to take your lumps, you’ve got to find that reserve in you somewhere. That’s generally without sounding like you know, too self serving as a as an advertisement for a coach. But that’s where a coach comes in, where they can sort of get your head realigned to say this is not working, you really have to think about taking some decisive action. Yeah, I know, you invested a lot. Tough, didn’t work out, move on. Same thing when it comes to clients. Right. The other the other side, you know, I’ve had people who have toxic clients. And I’ll suggest to them, why don’t you fire them? Why don’t you fire this client? And it’s almost like, if I put that if I put that up on your little Facebook group, I bet you I get a lot of cards. Saying what what did that guy say? Right? First, he’s telling me that I rented a job. And now he’s telling me that I should fire my clients. Well, I tell you what, there are toxic clients that can drag you down, right? Most businesses are Pareto, right? They’re 8020 80% of your revenue comes from 20% of your clients. Well, I will tell you that the bottom, that’s the top 20%, the bottom 20% of your client base is probably eating up 80% of your resources, right is the corollary there. Those are your micro clients. Now, I’ve had this debate with certain clients where they said Yeah, but you know what, they were with me from the beginning, and they took a risk on me. And I can’t do that to them. I can’t fire them. And I and I get that I understand that loyalty there with the people who, who took a chance on you and did business with you. But at some point in time, you’ve got to level those people up. You just do and if you have to have a heart to heart with them, and say, I know you’ve been with me since we started and we were nobody but we’ve scaled up our business now. I can’t continue to grandfather you in at a rate I’ve had people clients who the people were grandfathered in at a rate that was costing the company money. I did an exercise with one guy where We figured out he was losing $10,000 MRR per month on these micro clients, he would have been $10,000 positive, he just cut them loose. That’s tough. It’s another another difficult thing. But entrepreneurship is tough. You got to make tough decisions. Sorry to be the bearer of bad news.
Yeah, well, the way I look at it is, and I agree in terms of firing the wrong person that you brought on the bus, getting that person off the bus as soon as possible. And even firing clients or customers that aren’t the right fit, I look at that, as in terms of me doing what I can to keep my best people. Because if I have rockstars on my team, which I definitely do, and I bring somebody on that it just wastes time that causes issues that gossips that brings baggage. If I don’t fire that person, then I am not showing how much I appreciate the people that are there that are working their butts off that are doing a great job for me. And I think the same thing is true for a customer that just brings negativity that’s berating my customer service team or whatever. And so for me, that makes it a little easier. So because I can be a softy sometimes, and say, You know why? Why don’t we give this guy another chance? Why don’t we give her another chance. But if I think of it in terms of my team, and me going to bat for them, and saying, you know what the people that I have here already, our core personnel is more important to me, than trying to help this guy work through his issues. And that helps me when I compare it in that kind of atmosphere where it’s like I either keep the bad guy, and you know, risk losing some of my top talent, or get rid of them, it makes that decision a lot easier than you know, I still need to fill that position but softens the blow a little bit. It’s a great,
it’s a great way to look at things, right? Look at it from a morale perspective. And believe me when it happens, and I know know people have done it myself and myself included, people come back and Thank you, Thank God you got rid of, you know that guy, or thank God, we don’t have to do business with these people anymore. Right, everybody exhales. And that’s important. And you need to nurture your top talent, they are your life, blood, and there’s only going to be a couple of them, it’ll be a couple of key no matter how big your company is, there’s always just a couple of key players that you need to keep happy, because they will keep the ship running smoothly. And take the pressure off of you as the entrepreneur. Because if you can’t delegate to your top talent, again, you got another problem, right? And you’ve got to empower them. And you’ve got to be able to delegate and you’ve got to get again, give them the latitude to make mistakes, because they will, let’s shift gears and talk about your book.
Will you tell me a little bit about the reasons why you kind of came up with this idea? I know that you mentioned that it was a course originally developed into a book. Tell me a little bit about the reason reasons why you ended up writing a book, you know, the writing a book was always on my bucket list.
One of the things I do is I manage a book of money, I manage some other people’s money family members, right because I trade stock markets and I’m without being too grandiose, in a pretty darn good. I’ve been trading for 40 years. So if I wanted to just be a trader and do that I can make a very, very nice living and I have I have done it in the past. Except it’s incredibly boring. And your role becomes really, really small. And we’re social creatures. So a bunch of years ago, I managed my niece and nephews money and I tried to teach them about money. And it was just a complete failure, had no plan. I just it just didn’t work. And they were in high school at the time. And they weren’t really ready for it. So a couple years ago, I went to a conference in Bangkok with about 300 entrepreneurs and we were doing some mastermind breakout. So I was at a table with a bunch of coaches. And we were talking about our B hag, you know, our Jim Collins big, hairy, audacious goal. And I said, I really want to write a course on how to manage and grow your money. And they kind of looked at me and said, you know, Henry, and I can and a younger, you know, you might want to get on that. And so I took that swift kick in the butt. And I went home and and I wrote it, I wrote this course. And then I tested it with with about a dozen people and I was all ready to go to market and a few folks said to me, You know this, you should make this a book. That’s your lead magnet. And I thought, Well, you know what, I always wanted to write a book. And yeah, that makes a lot of sense. And that took me down a whole rabbit hole. Because writing took me like a year. I had to hire a copy editor. It’s like what’s a copy editor? Oh, that’s what they do. I had to hire a layout guide to layout out in InDesign. I had to Hire a guy from Fiverr. To turn these two hits these 250 infographics that I had just grabbed off the internet into a vector file so that they would actually print because this is actually going to be printed in a real book. And then I had to get the rights from people who had copyrights on it. So it was like, wow, I can write a whole course on how to go through and, and write a book. So that’s basically the backstory, I took all my all my knowledge. I wrote a table of contents, 18 chapters, I want it to be 18 chapters, and I’m a golfer. And I started with chapter one. And I finished with chapter 18. And I just plowed right through it.
But I did love it. So so you have different acts in your book, right? Correct. One is you yourself in you. Tell us about that. Tell us about some of the chapters and some of the concepts that you cover there.
Right. So I use my you know, as a screenwriter, movies fit in a three act structure. Right? So the way it’s described in screenwriting is the protagonist Who’s your your main character in Act One, the character climbs a tree in Act Two people throw rocks at them. And in I’m sorry, an act two and then an act three, he figures out how to get down from a tree. If you want to know anything that there is about movies, Rita read Blake’s Blake Snyder’s book called save the cat. I’ve had all my kids read it, and they’re like, Oh, yeah, this is the plot of every single movie. So Act One, you yourself and you, that’s where I go through psychology of money, I go through something I call the thick green line, which is, which is your net worth versus your age as you traverse through life, and the various life stages that I do your balance sheet, your your p&l, you know, your profit loss, your income statement, what’s your net worth balance sheet would be like a net worth statement for an individual. And the whole idea is we need a baseline, I need to know what you have now. Right? You’re 43 years old, I made a fictitious family, you have a house, you have some assets, you got some money, you got this. And then you’ve got a bunch of liabilities that go with it. But everybody has a net worth. And then the thick green line is the idea of looking forward to what I refer to as contingent liabilities, like what are the what are the liabilities that are waiting down the road that you may not be considering today? Right, paying for kids college, paying for your retirement, maybe paying, maybe subsidizing your parents, I know, I know, folks who subsidized their parents, parents didn’t save enough money. So they pay mom and dad’s rent. So there’s a lot of these things. So that’s, that’s chapter one. That’s where we have to start. have to know where you are today.
Gotcha. You talk in Act Two, about investing a little bit tell us some of the subjects and some of the information that you cover in Act Two?
Well, I go through all of the various main also, I’ll say mainstream investments. So obviously stocks and bonds, commodities, real estate, there are lots and lots of places that you can park your money. So I did a chapter on fundamental analysis of, say equities, like a stock like let’s say you wanted I’ll give you an example, when the market had a waterfall decline last March with COVID, I started looking for what I refer to and many people refer to as fallen angels. So I was looking, I was looking for good companies that got whacked, because everybody, everybody got sold off at the same time. But not everybody’s fortunes. Were going to go down the tubes. So I looked at Disney, I don’t Disney in the past. And I said, so I download their their what are called their 8k filings that they have to do each quarterly and I go through it. It’s very tedious, time consuming, and not everybody wants to do it. But there’s gold in there. There’s gold that tells me how bad is this? I know their theme parks are closed. But what other assets and what other income streams Do they have that can make up the difference? So if the market wants to put Disney on sale for 50% off, right, by just by people just dumping their shares, there may be a bargain there. And there was I bought it. Yeah. And I sold it about a month or so ago, and it’s still going up. Right? I made I made a tidy profit on that. I talked about technical trading, which is using charts. So I’m I’m one of those rare hybrids who actually uses both fundamental trading and technical trading. I use technical trading to tell me sort of when to get in and out. And I use fundamental trading to really tell me like what’s the value of this asset that I’m buying. I talked about real estate. You know, I I’m, I’m talking to you from the brand new house that we just bought. House is not brand new The house is from the 1800s. But it’s brand new to us. And I had to pay 20% over the asking price, because the real estate market has gone crazy in the world with COVID. The question is, is that a good deal for me? Right? This is my primary residence? Or did I make a mistake? I don’t believe I made a mistake. But these are things that you have to look at. And then how do you allocate them in a way that allows you to not keep the proverbial all eggs in one basket? Right? There’s an old saying it’s okay to put all your eggs in one basket, just watch that basket. I believe that you should diversify across a variety of different things. Because some markets go up and some markets go down.
Gotcha. So in Act Three, you have a chapter called buying sh, Asterix T. Tell me about that.
Yes. Well, I talked about how you how you go about buying stuff, right? I use the same sort of a three legged stool principle. You know, what is the process that you go through? When you buy something? Right, I used the example of cars, I talked about how I use this thing called on what it is it was a guide to to, to how you buy cars. We just bought a since we bought a new house, every time we buy a new house and we bought I guess three or four in our 30 years of marriage, we buy a new car to go along with it. So our philosophy is we buy the best thing for us. We’ll get it all all decked out with everything. And we’ll drive until the fenders fall off. Just about every every car I have owned in my adult life, whether I buy it new or used and I usually alternate, I’ve never gotten rid of a car that had a note on it. Meaning even if I took a five year loan, I will pay the loan off and I will I will own the car for some period of time with no loan on it. Right? That to me is free money. At that point, if I can get to that point and just keep driving until the fenders fall off. Again, you’ve got to match that core philosophy for for how you deal with buying stuff. With your other wants and desires. I know other people who leased their cars, they hold them for three years. And that’s it. And they because they always want to drive a new car. But if we do the arithmetic on that you’re gonna find that they’ve they’ve spent a lot more money on their cars than I have. And maybe they’ve gotten that much more joy out of it that that question I can’t answer.
I was debating whether to kind of share this publicly because, you know, I’m in my 40s now, but I I share a lot of financial and business information through different social media channels. And just this past week, I made a video on Tick tock, I don’t know if you’re familiar with
that. I’ve heard of it. Yeah.
Okay, gotcha. And basically, it’s just an app that has quick videos, a lot of its people dancing or something to do with music,
skateboard with some Ocean Spray that went viral. Yeah, so I’ve seen
Exactly. Yep, so that type of video, right? He had I don’t know how many millions,
a trillion views, I think,
Oh, goodness, No, I’m
kidding. So anyway,
a lot, right? Hundreds of millions, something like that. But anyway, so I make this very short video. And, and in the video, I say, hey, if you want to be rich, then don’t buy stupid things. Right? You buy assets before you buy liabilities. And well I made this video in my sports car and my sports car has a little emblem on the passenger seat. Well what happened is my video went viral. It’s like the second or third video that I had posted on Tick Tock or something like that. I didn’t even know what I was doing. But what ended up happening is I get and last time I checked so I posted this a day and a half ago and I’m at half a million views. Wow. Which I didn’t plan on this but it’s so tik tok is for kind of a younger crowd, right? But I ended up getting although I stand by what I what I said in the video. I ended up getting all of this advice from broke 12 and 13 year olds, right it’s the it’s the funniest thing but a lot of them argue with me. Like no Hey, live your life by whatever you want. Then I had the people making fun of my you know, saying something about my sunglasses were too expensive or my car was too expensive and I was like, hold on a second. I, yeah, I said if you want to be rich, right, so once you make the money, then you can spend it right then you can quote unquote waste it as long as you’re in a position where your money is doing something for you, where it’s working for you. And so when I when I looked at the chapter of chapter 14 title, I thought that’s kind of what you were getting at. Because I told him don’t buy stupid things. And your chapters called buying.
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